Saturday, February 24, 2007

Barcap Boom

Word has it that the developers at Barcap are jumping for joy at their bonuses this year. After several years of sub-par bonuses, and difficulty last year in bringing new developers on, Barcap finally saw the light and rewarded their hard-working devs with a decent chunk of change.

Companies should realize that Wall Street is an extremely small, tight-knit community, and that word of good and bad bonuses spread like wildfire. In order to retain good talent and hire new talent from other companies, a firm has to have a good reputation with regards to bonuses in the IT department. It doesn't matter if your traders and sakesmen are getting 300% bonuses ... it's the IT department that has to write and maintain the systems that drive trading operations.

Consider the cost of losing the only person on a team who knows the code of a complex system. Think of the time you have to spend hiring a replacement (taking time from employees to do the interviews, headhunter fees, sign-on bonus, etc), doing the knowledge transfer, and waiting for the perosn to get acclamated to the system. How much does a company spend when it loses an experienced hire and tries to bring on a new one? Would that amount of money, if applied to a bonus, suffice to retain a talented individual?

Often times, it is not the fault of the IT managers. It's a matter of convincing the business that IT really matters.